George v The Queen

[2022] SASCA 86

SUPREME COURT OF SOUTH AUSTRALIA

(Court of Appeal: Criminal)

GEORGE v THE QUEEN

[2022] SASCA 86

Judgment of the Court of Appeal  

(The Honourable President Livesey, the Honourable Justice Doyle and the Honourable Justice Bleby)

1 September 2022

CRIMINAL LAW - APPEAL AND NEW TRIAL - APPEAL AGAINST SENTENCE

CRIMINAL LAW - APPEAL AND NEW TRIAL - APPEAL AGAINST SENTENCE - GROUNDS FOR INTERFERENCE - SENTENCE MANIFESTLY EXCESSIVE OR INADEQUATE

CRIMINAL LAW - PARTICULAR OFFENCES - PROPERTY OFFENCES - OTHER FRAUDS AND IMPOSITIONS - FRAUDULENTLY OR DECEPTIVELY OBTAINING MONEY, VALUABLE, FINANCIAL BENEFIT OR ADVANTAGE - SENTENCE

Application for permission to appeal against sentence.

On 5 March 2021, the appellant pleaded guilty to four counts of aggravated deception, contrary to s 139(a) of the Criminal Law Consolidation Act 1935 (SA). On 17 December 2021, a judge of the District Court sentenced the appellant to a head sentence of eight years, one month and 19 days, and a non-parole period of four years and 10 months, reduced on account of the appellant’s guilty plea and time spent in custody.

The sole ground of appeal is that the sentence was manifestly excessive.

Held (by the Court), granting permission but dismissing the appeal:

1.Although the offending netted a comparatively small amount when considered against other cases, the offending occurred over a period of years. It was calculated and directed to victims whom the appellant knew to be vulnerable. In addition to the monetary loss each victim suffered, the emotional harm the appellant inflicted was considerable.

2.As concluded by the sentencing judge, with reason, the appellant did not have good prospects of rehabilitation and had little insight into his offending or the harm he has caused, both economic and emotional.

3.      The sentence imposed, while severe, was not manifestly excessive.

Criminal Law Consolidation Act 1935 (SA) s 139(a); Sentencing Act 2017 (SA) ss 9, 10, 11(1)(b), 26, referred to.
Hili v The Queen (2010) 242 CLR 520; R v Morse (1979) 23 SASR 98, considered.

GEORGE v THE QUEEN
[2022] SASCA 86

Court of Appeal – Criminal:    Livesey P, Doyle and Bleby JJA

1. THE COURT:  This is an application for permission to appeal against sentence. The sole ground of appeal is that the sentence was manifestly excessive.

   Background

2. On 5 March 2021, the appellant pleaded guilty to four counts of aggravated deception, contrary to s 139(a) of the Criminal Law Consolidation Act 1935 (SA) (CLCA). On 17 December 2021, a judge of the District Court sentenced the appellant to a head sentence of eight years, one month and 19 days and set a non‑parole period of four years and 10 months. 

3. The offending occurred between 2015 and 2019, against a background of events that commenced some years earlier. The complaint of manifest excess as framed at the hearing of the application requires an understanding of those events. The sentencing judge recounted them in some detail; how she ultimately treated them formed an important focus of the appellant’s submissions. What follows is a precis of those earlier events and the offending, none of which is in contest.

   Background to Count 1

4. In April 2012, Mr and Mrs H, who were public servants approaching retirement in Port Macquarie, NSW, were looking for opportunities to invest their self-managed superannuation fund (SMSF). Mr H emailed a company called Swiss Private Capital, an asset management company based in Dubai. Following Mr H’s approach, the appellant telephoned and emailed Mr H, introducing himself as Mr H’s investment manager for all future relations and questions.

5. In July 2012, the appellant forwarded Mr and Mrs H an ‘Investment Agreement’, which they signed and returned. He provided them with bank account details for them to transfer their money. They transferred a total of $454,992.59 to the nominated account. This sum, effectively representing their retirement savings, was to be invested under the terms of the investment agreement.

6. Mr and Mrs H sought to withdraw some of the funds in late 2012, unsuccessfully. At about that time, they received documentation, purportedly from Swiss Private Capital, identifying that their investment had increased to $700,000 in only four months. They also received an email explaining that they would not be able to access their accounts.

7. In April 2013, Mr and Mrs H received an email from a Joel McKay, purportedly from the New York office of Swiss Private Capital, requesting their personal bank details. They had previously given these details to the appellant. The appellant subsequently contacted Mr H by telephone and discussed investing in gold with a four per cent per month return. Then on 26 June 2013, the appellant sought their approval to move the funds to a ‘secured buy/sell’ arrangement that would run for two months. Mr H approved the proposal.

8. In August of the same year, Mr and Mrs H sought to withdraw $110,000 but were unable to do so. They were then unable to contact Swiss Private Capital at all. Eventually, they contacted the appellant. He said he was no longer working for Swiss Private Capital. Mr and Mrs H subsequently received a generic email purportedly from Mr McKay, asserting that there was a ‘fight’ with the webmaster, causing Swiss Private Capital to be unable to access their database and their client accounts. Mr and Mrs H remained unable to access any of the funds they had transferred to Swiss Private Capital.

   Count 1

9. In October 2015, the appellant contacted Mr and Mrs H unexpectedly. He said that he was working for Swiss Private Capital again, for the sole purpose of getting Mr and Mrs H’s money back. He said he could get most of their money within 60 days, but they needed to pay $17,400 ‘to cover the shipment and investment of gold’. Mr and Mrs H transferred that sum to a Westpac account on 27 October 2015. Those monies were then withdrawn within days from the Gawler branch of Westpac. They were not used for the purposes the appellant had described.

10. Then in June 2016, the appellant emailed Mr and Mrs H. He advised that there were 12.5 kilograms of gold in Dubai and requested a payment of $9,200 for import costs for the gold to enter the United Kingdom. Mr and Mrs H transferred that amount to the same bank account. That money was withdrawn in cash within four days, from various Westpac branches in the Northern suburbs of Adelaide.

11. On 15 August 2016, the appellant emailed Mr and Mrs H again, requesting a further $3,325 for customs clearance. He followed that up saying he had forgotten to convert the sum from Sterling to Australian Dollars and that what was actually required was $7,010. He told them that they would receive $463,700 plus reimbursement for the two previous payments. They transferred the $7,010. Within days, the appellant withdrew $5,250 in cash with the remainder being garnisheed to the Fines Unit. Mr and Mrs H transferred a further $4,235 on account for purported import duties, refinement costs and bank fees. The appellant withdrew that amount as well.

12. Then in September 2016, Mr and Mrs H were sent an invoice from a mining company, advising that $13,760 was outstanding for payment for export clearances. Mr and Mrs H transferred that sum to the appellant’s bank account on 19 September 2016. The appellant withdrew $12,000 in cash within days.

13. The accepted factual basis for the plea also records that in July 2015, the appellant introduced Mr and Mrs H to what he described as an investment opportunity with another company, saying that clients from Swiss Private Capital had invested with it. They transferred $20,000 to a bank account that the appellant had opened on 16 July 2015. That money was all withdrawn in cash, again within days.

14. Mr and Mrs H made further transfers at the appellant’s request, totalling $10,137. On each occasion, the monies were withdrawn nearly immediately in cash.

15. Mr and Mrs H transferred a total of $81,742 to the appellant. They have never received any of those monies back.

    Background to Count 2

16. In 2013, Mr M, a resident of New York State, invested an inheritance with a company called Swiss Wealth Limited Financial Services located in Geneva. The appellant became Mr M’s advisor, using the pseudonym ‘Christopher Dupont’ and calling himself a senior investment manager. In 2014, the appellant was found in possession of an international driver’s licence and student card in that name.

17. In late 2013 and early 2014, Mr M transferred a total of USD $500,000 to the company account held by a Caribbean bank. He received monthly statements in the same format as those received by Mr and Mrs H. In the second half of 2014, Mr M viewed his investment online and saw that it was worth over USD $600,000. In late 2014, he attempted, unsuccessfully, to make a small withdrawal.

18. By early 2015, the online statement showed the investment to have grown to USD $900,000. The appellant asked Mr M if he was prepared to invest USD $100,000 in a new investment opportunity. Mr M said he could not put his family’s security at risk and asked the appellant to use the monies already in his account. He did not receive a response for five months. In May 2015, the appellant then advised Mr M that he no longer worked for the company and that the partners had decided to dissolve the company and pay out the investors:

    …as we have to claim insurance on one oil tanker delivery of $103Million and we were also unsuccessful in court claiming arbitrage as one of our buyers defaulted on payment of heir Letter of Credit leaving us with an oil tanker full worth $103Million with no buyer and many other costs…

19. The appellant also said, inconsistently with the above, that he was back in Switzerland. He would look up the file and account when he was back in the office ‘tomorrow morning’ and tell Mr M his payout figure and insurance costs. He said that ‘we’ would mostly cover those costs ‘as the oil was sold at 32% below the purchase price’.

20. The appellant then requested a further USD $71,000 for Mr M to have his investment released back to him. Mr M said to take that out of his account, but the appellant said he could not access it. In late May 2015, Mr M signed a Deed of Release and paid the appellant USD $38,200 to have the monies released, after the appellant had agreed to reduce the fee for the release. In the middle of June 2015, the appellant then requested further funds to release the monies. Mr M did not pay.

21. The appellant did not contact Mr M again until 2 September, claiming to have been in hospital for five weeks with a major lung infection. This was at the time when he was withdrawing the monies paid by Mr and Mrs H, the subject of Count 1. There was no further contact between the appellant and Mr M. Mr M sought legal advice in the US but could not afford to engage lawyers.

    Count 2

22. In May 2018, Mr M received an email from a person identifying as To Quoc Vo, Company Administrator for Swiss Wealth and Secure Trade Investments. This person claimed to have identified an outstanding balance of USD $537,500, to be paid out immediately. He requested Mr M pay an administration fee of USD $6,223.31 to recover the funds.

23. Over the next few weeks, Mr M sent a total of AUD $12,868 in five separate transfers. He heard nothing and when he contacted the bank where the monies were supposed to be held, he was told that the account was empty. He reported the matter to the police. In the course of him sending the monies he received an email purportedly from Mr Vo, advising him that the amount to be returned to him had increased to $855,166.16.

24. To Quoc Vo provided an affidavit to SAPOL. The effect of his evidence is that he and his partner both know the appellant. He has never worked in the financial sector and does not know Mr M or Mr V, the victim of Count 3. The appellant asked Mr Vo to collect money from Western Union. Mr Vo did not receive any benefit from doing so.

25. The appellant’s Westpac account shows a number of payments in 2019 to ‘T Q Vo’ in sums of between $250 and $450.

    Background to Count 3

26. In about 2011, Mr V, who was a teacher from Melbourne, made contact with someone in an on-line investment chatroom. He was then contacted by the appellant, giving the name of ‘Chris’ from Adelaide. Mr V told the appellant he was interested in investing $200,000, which he had obtained as a line of credit connected to his home loan. The appellant told him that he worked with two German brothers called Marc and Janz Weber and that he was a senior investment manager with Swiss Private Capital.

27. Mr V said he wanted to meet the appellant face to face. They arranged to meet at Tullamarine Airport. The appellant said he would be coming through there on his way to Germany. He gave Mr V a phone number, being the same number he had given Mr M in the name of Mr Vo.

28. The appellant told Mr V that he usually only dealt with overseas investors but was willing to discuss with his partners bringing on an Australian investor. He later told him that the Webers had agreed, and that he could generate a return of three to five per cent per month.

29. Mr V enquired about any higher rates of return. The appellant said he had an investment available to him and his partners in relation to the sale of gold dust from Sierra Leone, on which they were receiving a return of at least 10 per cent per month. He said he could not offer an investment in that account, and Mr V would have to wait to for the next opportunity. He then advised Mr V to deposit AUD $200,000 into his personal account in Croatia. Mr V did so on 13 April 2011.

30. The appellant sent Mr V monthly statements over the next few months. They were in the same form as those provided to Mr and Mrs H and Mr M. The first month’s return was said to be USD $26,561. A small proportion of that was deposited into Mr V’s account. Mr V found it difficult to contact the appellant. Occasionally, the appellant would reappear and make contact. The appellant later told Mr V that he and his partners had been defrauded by a ‘Tier 1 Trader’, showing him a redacted ASIC document to demonstrate there had been a formal complaint.

    Count 3

31. In 2017, the appellant contacted Mr V via text message and told him that the misappropriated funds had been found in a bank account at the Emirates Bank in Dubai. The appellant said that he was the administrator and trustee of that account and that only he could deal with a particular notary and private banker to have the funds released. He also said that he and his mother had money in the account.

32. On 31 July 2018, the appellant forwarded an email, purportedly from someone at the Emirates Bank, asking for payment of AUD $8,694 in fees to settle the accounts of Ms Kim George and Mr V.  He requested various amounts of money for fees from Mr V to release the funds and said that they would be returned once the monies were released. Over the next six weeks or so, at the appellant’s request, Mr V deposited various amounts into the appellant’s account. These monies were in turn quickly withdrawn in various sums. Between 2 August and 24 September 2018, Mr V transferred a total of $28,650 into the appellant’s bank account.

    Background to Count 4

33. Whilst on a holiday in Bali, Mr MH met the appellant’s sister and their mother. The appellant then met Mr MH through his sister in Bali and introduced himself as a financial advisor. At that meeting, he raised the topic of investing Mr MH’s SMSF.

    Count 4

34. In 2019, the appellant again raised with Mr MH that he should invest his SMSF in Arbitrage Trading and showed him various documents purportedly demonstrating returns on investments. On 5 March 2019, he provided Mr MH with an ‘Investment Management Agreement’. On 11 March 2019, Mr MH transferred $65,000 to the appellant’s Westpac account. The balance in that account immediately prior to the transfer was $247.51.

35. The appellant withdrew $3,000, mostly in cash, from that account on the same day. The next day he arrived in Bali and stayed there for 10 days. He returned to Bali on 27 March 2019, staying for 12 days. When he returned, the balance in the relevant account was $52,920. He travelled again to Bali in April, June and July of that year. By the middle of July, the balance in the account was less than $1,000. The appellant had spent $64,000 of the money deposited in that account on his daily living expenses and travelling to Bali.

36. The appellant made five payments to Mr MH. The first was done using Mr MH’s own money. The subsequent four payments were made from funds invested by Mr MH’s best friend, Mr D.

37. None of the payments made to Mr MH constituted a return on Mr MH’s investment: there had been no investment. Mr MH did not receive any statement of returns, which he needed for tax purposes in relation to his SMSF. He had difficulty contacting the appellant.

38. Mr D invested $48,000 of his SMSF with the appellant. By 31 October 2019, the appellant had expended all of Mr D’s funds. The dealing with Mr D’s funds constituted uncharged conduct.

    The sentencing judge’s approach

39. The judge expressed the relevance of the background to the first three counts in the following way:

    It is important to bear in mind that you have not been charged with the initial investments made by Mr and Mrs H, Mr M, or Mr V. You have not been charged in relation to the D offending. Where that money went will perhaps never be known. You are to be sentenced, however, for the later involvement in relation to Mr and Mrs H, Mr M, Mr V and Mr MH.

    For Mr and Mrs H, Mr M, and Mr V, knowing that they had lost their initial investment and such a substantial amount of money, you reconnected with them and told them that you could recover this money. They were vulnerable and you knew that. The pretext of being able to recover the funds was a lie, you simply used it to get money from them. In all likelihood, had you not been arrested, the same ploy would have been launched against Mr MH, and perhaps others.

40. The judge gave full account to the matters raised in mitigation of penalty. No complaint is made in this regard. The appellant had some minor offending history as a juvenile. At the date of sentence, he was 35 years old. He had a good education. There was some suggestion that he suffered from anxiety and depression and required pain management. He had abused substances over the years, including benzodiazepines, heroin and cocaine. The psychological report from Dr Jack White indicated that the appellant remained in denial that he had done anything wrong. Dr White considered that part of this denial may be due to his unstable personality make up, his general psychological vulnerability and a level of naiveness. A number of character references were provided on the appellant’s behalf.

41. The judge determined to sentence the appellant on a basis consistent with his pleas of guilty, in that his offending began in 2015 with Mr and Mrs H and continued after that time. She did not consider the appellant’s prospects of rehabilitation to be good and was of the view that the appellant had little insight in relation to his offending. Importantly for the appellant’s contentions on appeal, she said:

    The fact that you offended against people who you knew had already lost a significant amount of money and were very vulnerable is an aggravating feature. The fact that you were in a position of trust in relation to them is an aggravating feature. The fact that you did not seem to have any other means of supporting yourself, other than through the scams that you committed on these people is also a factor to be taken into account. None of your conduct was isolated, none of it occurred on the spur of the moment. It was all premeditated and occurred over a lengthy period of time.

1. The judge noted that the appellant had provided no assistance to the authorities with respect to tracing the original investments nor any assistance as to where the money was secreted. The appellant had not paid any compensation or given any explanation. The judge paid express regard to the matters detailed in the various Victim Impact Statements, which expressed the heavy economic and emotional impacts on the victims.

2. The judge determined to impose a single penalty pursuant to s 26 of the Sentencing Act 2017 (SA). She described the offending as very serious, calculated, premeditated and having been committed against vulnerable individuals. She indicated that absent the plea of guilty, a term of imprisonment of nine years would be appropriate. She reduced that by five per cent on the basis that the pleas resulted in a utilitarian assistance to the community, noting that the case against him was strong in any event. On that basis, she reduced the penalty to eight years, six months and 19 days.

3. The judge set a non-parole period of five years and three months. She then reduced the head sentence and the non-parole period by a further five months, on account of time already spent in custody and the fact that the appellant had been on home detention for nearly a year. The head sentence therefore became eight years, one month and 19 days. The judge fixed a non-parole period of four years and 10 months. The judge declined to either suspend the sentence or to order that it be served on home detention.

   The appeal

4. As already identified, the appellant makes no complaint of process error. However, in pursuing the complaint of manifest excess, senior counsel submitted that it was apparent from the sentencing judge’s remarks that the length of the sentence was, in part, a product of the judge bringing to account the appellant’s knowledge of the vulnerability of the victims. The judge thereby brought to account an assessment of the appellant’s knowledge and conduct prior to the offending. This submission went so far as to say that the judge may even have committed a process error in treating as an aggravating feature the fact that he offended against people who he knew had already lost a significant amount of money and were very vulnerable.

5. The Notice of Appeal makes no separate complaint of process error. In any event, we do not accept that the judge erred in treating the appellant’s knowledge of the vulnerability of the victims as an aggravating feature. Section 11(1)(b) of the Sentencing Act identifies that the personal circumstances and vulnerability of any victim of the offence is a relevant matter for the Court to take into account in sentencing. The appellant’s knowledge of that vulnerability and calculated exploitation of it are directly relevant to his moral culpability. Those matters also demonstrate that his conduct was no mere aberration. It was a considered course of exploitation of people who were vulnerable, to the appellant’s knowledge, to financial deception. The offending occurred over a lengthy period.

6. The sentence imposed by the judge was severe. The respondent readily accepted as much. The total amount the appellant extracted through the offending was $189,256.14. The appellant pointed to other cases of fraudulent conversion, falsifying accounts and theft, where the amount stolen in each case was considerably higher and where, variously, the starting point was lower or at least comparatively lenient, having regard to the amount in question.

7. As the appellant readily acknowledged, there was limited use that the Court could make of these comparisons. The amount of money in question in each case may provide some limited comparative assistance. However, any such assistance is necessarily constrained by the great variety of factual scenarios underpinning the offending and matters relevant to sentencing in the individual case, as directed by ss 9 to 11 of the Sentencing Act. For the purposes of an appeal of this nature, it is well established that any question of manifest excess is informed by a consideration of all matters relevant to fixing the sentence, including the circumstances of the offending and the personal circumstances of the offender.[1]

   [1]     Hili v The Queen (2010) 242 CLR 520 at [60]; R v Morse (1979) 23 SASR 98 at 99 (King CJ).

8. The maximum penalty for each offence, aggravated by the appellant having abused a position of trust, is 15 years’ imprisonment. The offending netted a comparatively small amount when considered against some of the cases the appellant identified in submissions. However, it occurred over a period of years. The appellant was originally charged with 26 counts of aggravated deception contrary to s 139(a) of the CLCA. He eventually pleaded guilty to the four counts as laid on a fresh information, each relating to a different victim, on the accepted basis that each count incorporated, respectively, the instances referable to each victim.

9. The offending was calculated and directed to victims whom the appellant knew to be vulnerable. The appellant had ample opportunity to reflect and desist. In addition to the monetary loss each victim suffered, the emotional harm the appellant inflicted was considerable.

10. The appellant had a good education. He has a number of health conditions. He has abused substances in the past, including benzodiazepines, heroin and cocaine. Dr White recommended a drug and alcohol rehabilitation program and follow-up with a psychiatrist. He described the appellant’s prognosis as ‘fair at best’. There is some indication that the appellant may have a bipolar disorder, but that has not been diagnosed. As the sentencing judge observed, Dr White considered that the appellant remained in denial that he had done anything wrong.

    Conclusion

11. The offending called for a sentence that reflected all these matters. Several of the considerations identified above rendered the offending egregious. The sentencing judge concluded, with reason, that she did not consider the appellant’s prospects of rehabilitation to be good and that he had little insight into his offending or the harm he caused, both economic and emotional. The sentence imposed, while severe, was not manifestly excessive. We grant permission to appeal but dismiss the appeal.